Watsco Q4 revenue misses expectations; dividend raised 10%

Watsco

17/02/2026 12:37

Overview

HVAC distributor's Q4 revenue missed analyst expectations

EPS for Q4 was $1.68, no analyst comparison available

Company boosts annual dividend 10% to $13.20 per share

Outlook

Watsco expects a more conventional industry environment and better growth prospects in 2026

Company aims to optimize inventory and improve operating efficiency in 2026

Watsco plans to enhance growth with AI-driven initiatives and technology platforms

Result Drivers

A2L TRANSITION - Revenue decline due to lower HVAC equipment volumes, offset by higher selling prices post-A2L transition

MARGIN IMPROVEMENT - Gross profit margin expanded due to pricing optimization technologies and OEM pricing actions

TECHNOLOGY INVESTMENTS - Strategic investments in technology and digital platforms to enhance customer experience and efficiency

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q4 Sales
Miss
$1.58 bln
$1.62 bln (12 Analysts)
Q4 EPS
$1.68


Analyst Coverage

The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 13 "hold" and 1 "sell" or "strong sell"

The average consensus recommendation for the electrical components & equipment peer group is "buy."

Wall Street's median 12-month price target for Watsco Inc is $382.00, about 8.6% below its February 13 closing price of $417.92

The stock recently traded at 32 times the next 12-month earnings vs. a P/E of 28 three months ago

Press Release: ID:nGNX9Lgj8S

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)